I must confess I am surprised that Bank of America is close to settling a litigation threat by a group of investors headed by the New York Fed, Pimco, and Blackrock, which was discussed in the media quite a bit last fall for a reported $8.5 billion.
While most threatened litigation is settled out of court, this case in theory had to overcome procedural hurdles for any suit to be filed, and no group of investors had ever surmounted this impediment. Chris Whalen similarly noted that BofA could simply tell the investors to “pound sand.” However, we had noted that if it moved forward, that this type of case, a representation and warranties case, is always settled because they are too expensive to fight in court.
And representation and warranties cases of this type (which would demand that the servicer make the originator buy back dud loans) requires that the investors not merely prove that the seller lied, but that the lies were THE reason that the losses on specific mortgages took place (as opposed to normal “shit happens” loan losses, meaning due to unemployment or other loss of income, death, and disability). That means even if the judge approves the use of a sample that each side still will argue on the individual cases within that sample. Think how many loans that would involve across what as of the last sighting was reported to be 115 deals. Because these case are so costly to pursue, settlements historically have been 10% to 15% of the value of the loans alleged to have been misrepresented.
We had pencilled a settlement amount, if the case went that route as much lower, but that was also using the Wall Street Journal report that the amount of the bonds included in this action was $16.5 billion. The amount at issue ultimately was $58 billion, and 22 investors were involved, so we assume the much bigger amount is in large measure due to the increase in the number of participants and the much greater value of bonds). So if you gross up our estimate for the increased size and apply the same methodology we used earlier, you get to over $4 billion versus the $8.5 billion under discussion. While that’s a big disparity, the estimates by the litigation bulls were more off in the other direction.
But this begs the question: would BofA settle this case, and for this kind of number? It’s stance heretofore on these putback cases has been the banking equivalent of the Churchillian “We shall fight on the beaches, we shall fight on the landing grounds, we shall fight in the fields and in the streets, we shall fight in the hills; we shall never surrender.” And mortgage insurers, who have much better access to the underlying loan data, have not been able to prove widespread fraud, or even widespread breaches.
These are some factors that may have played into this change of heart:
The first reason may be that Bank of America has changed strategy and has decided it needs to put the matter behind them. Management or perhaps the board may have reacted to the damage to the stock price and concluded that it needed to fold. The dreaded “uncertainty” was taking too big a toll.
Second is the plaintiff’s lawyer may have convinced BofA that they had a way to overcome the procedural hurdle, which other investors had not been able to surmount on similar cases. As we had noted earlier:
The problem in suing is a bit circular: you need to be able to argue specifically what sort of breaches occured, but the investors lack access to the loan information to enable them to refer to specific breaches in a lawsuit. Or to put it in a bit more legalistically, unless the pooling and servicing agreement gives the certificateholders some rights to access to the loan files, you are likely to have an impediment: you may not be able to allege specific enough breaches to get to perform discovery.
And in that case, the issue would not just be Bank of America’s exposure to losses but the damage that could be done in discovery. And that damage comes on multiple fronts: the continuing bad press and resultant damage to the stock price of the sordid details of of how dreadful Countrywide was, and the revelations serving as grist for litigation by other investors. However, this settlement effectively proves that BofA can be shaken down with a threat of litigation that has never overcome certain procedural obstacles. The Wall Street Journal notes that any settlement may encourage other aggrieved parties to act:
The deal could embolden mutual-fund managers, insurance companies and investment partnerships to go after similar settlements with other major U.S. banks, arguing that billions in loans scooped up before the U.S. housing collapse didn’t meet sellers’ promises or were improperly managed. Most vulnerable would be Wells Fargo & Co and J.P. Morgan Chase & Co., which along with Bank of America collect loan payments on about half of all.
Third is that there may be evidence in other litigation underway (for instance, MBIA is suing Countrywide over similar issues, and mortgage insurer have much stronger contractual rights to putbacks than investors) that the bank knew might allow these investors to add more claims to their litigation that had additional economic value (as in the settlement might be broad and include any litigation related to these bonds, and BofA recognized that with this big an investor group united, it was exposed to other sorts of action.
More broadly, this development at a minimum shows that Bank of America to be running scared. I wonder what other shoes might be about to drop on the mortgage front.
And it also confirms our initial take on the Countrywide deal, which we disapproved of merely when BofA made an investment in the struggling subprime lender:
…even though the financial press has almost universally hailed Bank of America’s investment in Countrywide as a bold and savvy stroke, the market has remained singularly unimpressed.
I will confess I haven’t studied the details of the deal for a simple reason: I’m appalled that B of A would even consider it. The two banks had reportedly been talking for six years. That means B of A knew, or ought to have known, Countrywide very well. An article by Gretchen Morgenson in Sunday’s New York Times paints Countrywide is, at least in spirit if not the letter of the law, a criminal enterprise, aggressively targeting misrepresenting its products and pushing customers into unnecessarily costly mortgages.
…. I know lawyers who have Countrywide in their crosshairs, and I am certain they have plenty of company.To put it another way: there’s enough fraudulent selling in the the subprime market in general, and smoke around Countrywide in particular, to deter anyone investor who takes litigation or reputation risk seriously.
In my day, no respectable institution would make a high-profile equity investment or otherwise closely link its name with an organization that had the whiff of serious liability about it (except in liquidation or some other scenario which got rid of the incumbent management team).
So even though underestimated Bank of America’s anxiety to settle a specific action that would be costly to prove in court, this move would be consistent with the risks we identified back in 2007.
Update: An attorney who is a card-carrying Countrywide hater pinged me to express skepticism about this news item. He said that the plaintiff’s attorney has been trying to move this action forward via press releases, and he can’t fathom any reason for BofA to settle ex having the other side overcome the heretofore unbeaten procedural hurdle. So he thinks this will prove to be more bluster.
Update, 12:00 AM: As details come in, this is more consistent with our initial views. I pinged MBS Guy. His response:
I can’t find any news confirming that the lawsuits were ever filed. Just a threatening letter to the trustees that the clock was ticking and they had 60 days to respond (starting from back in October, 2010, by the way).
http://www.bloomberg.com/news/2010-10-19/pimco-new-york-fed-said-to-seek-bank-of-america-repurchase-of-mortgages.htmlBack in March, they were still discussing the terms of the letter. http://www.gibbsbruns.com/countrywide-rmbs-effort-gibbs–bruns-llp-issues-statement-03-31-2011/
In addition, the Sub-prime Shakeout website suggests that the bonds affected by the settlement actually have a current amount of $84 billion according to Bloomberg, compared to the $56 billion cited by the WSJ. In addition, the original amount of these bonds is, again according to Bloomberg, $182 billion. http://www.subprimeshakeout.com/2011/06/breaking-news-bofa-close-to-reaching-8-5-bn-settlement-with-blackrock-pimco-100th-post.html
Loans are repurchased at the stated principal amount, plus accrued interest – which is the original principal less any amortization that has occurred.
If the bonds affected are $84 billion, this sounds like it would be the best number for comparison, which means the $8.5 billion settlement would be equal to 10.1% of outstanding par of the deals. If true, then this isn’t a bad settlement for BofA and probably about at the same level as they are settling the Fannie and Freddie claims.
Also, as suggested by Subprime Shakeout – can these investors and the trustee really settle on behalf of all of the investors? Can BofA really get a release from all potential litigation relating to reps and warrants for their deals from this type of action? It seems awfully suspect to me, but if true, then maybe it really would be a good deal for BofA.
Ultimately, I remain skeptical that BofA would settle for such a large amount without even the filing of a lawsuit when the have lawsuits pending against them which they have fought tooth and nail from MBIA, Ambac, FGIC, Syncora and MGIC for an aggregate amount in excess of $20 billion worth of losses on approximately $60 billion worth of deals.
Where did this information come from (hint – Kathy Patrick) and why are the press accounts so varied on the details? I’m fairly certain there is more to this story.
And this comment from reader Pelican:
“The settlement goes beyond just the $56 billion of securities owned by these investors, however. It covers nearly all of $424 billion in mortgages that Countrywide issued, which were then packaged into mortgage bonds. That means that a broader group of investors will share in the proceeds, according to the people who were briefed on the proposed settlement, but were not allowed to speak publicly.”
http://www.nytimes.com/2011/06/29/business/29mortgage.html?partner=yahoofinance
If BofA can settle on $424 billion of bonds for $8.5 billon, that’s 2%, which is a screaming bargain, particularly if they get a broad waiver.
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Yves,
Nice article. BofA is run by a lawyer. His calculus is really quite simple. He sees the handwriting on the wall that he will have to disclose the loan-level data.
Why is this? Look what is happening in Europe with the Greek debt situation. Higher capital requirements have been exposed as irrelevant when depositors/lenders fear that a bank might be insolvent. The result has been a call for loan-level disclosure from UK Prime Minister David Cameron, Mervyn King and the Financial Policy Committee, the Bank for International Settlement and the Economist magazine.
The BofA CEO is getting ahead of the curve. If the litigants understood that in six months they would have access to the data, the settlement would be a lot higher.
Richard
Actually no, it is a silly article and posting.
It’s simply shuffling money back and forth among the culprits.
Bank of America owns a controlling share of Blackrock through its acquisition of Merrill Lynch during the meltdown, controlling shares of BP and Monsanto through Blackrock, etc.
When BofA tookover Countrywide, it created the Red Shield Bankruptcy Corp. and moved Countrywide’s debts over there, while hanging on to Countrywide’s assets, then declared bankruptcy for Red Shield, thus shoveling its debts on to the public.
FYI: Red Shield is a translation of Rothschild which, together with Mellon family money, owns the controlling share of BofA (through AXA Holdings and several other hedge funds, etc.).
Doesn’t take a rocket scientist to perform the dot connections.
Louis Brandeis, in his classic book, Other People’s Money and How the Bankers Use it, explained all of this mirage money disbursement; same thing together, just with more players and a bit more complexity.
I suggest you check your facts before casting aspersions.
Bank of America no longer owns any interest in Blackrock.
http://www.charlotteobserver.com/2011/05/19/1808734/bank-of-america-selling-blackrock.html
And the deal was announced months prior.
Wasn’t there a BoA Wikileaks file out there someplace?
Yves,
According to the article below the securities number is much larger.
“The settlement goes beyond just the $56 billion of securities owned by these investors, however. It covers nearly all of $424 billion in mortgages that Countrywide issued, which were then packaged into mortgage bonds. That means that a broader group of investors will share in the proceeds, according to the people who were briefed on the proposed settlement, but were not allowed to speak publicly.”
http://www.nytimes.com/2011/06/29/business/29mortgage.html?partner=yahoofinance
This makes the settlement a screaming bargain, particularly if the release is broad.
Yves,
The article points out that BofA has already paid out $17+b on the $442 billion of mortgages. So this brings the total to approximately $25 billion – still a bargain.
This settlement also shows what an advantage BofA/Wall Street had in fighting on a loan by loan basis when it was the only side that had the loan-level data.
Richard
Any possibility that they’re trying to keep a court from a finding of fact that they sold a trillion dollars worth of “secured” paper that was, in fact, not secured because they screwed up the trust stuff? Or at least delay such a finding until the criminal statute of limitations on fraud runs out? $8.5B seems fairly cheap if the alternative is that BoA is out of business and a bunch of people are going to jail…
If the settlement is at 10% of the original claim, what would the total thus far implicit and now pending losses in the financial system be if 90% of “assests” like these have to be taken against the P&L straight away?
Yves, could this be the opening broadside in a series of stepped “settlements” whereby BofA is dismembered and restructured via press release over the next 2 quarters ? This amount would not be a fatal blow to a BofA that was healthy and growing but it clearly is neither of those and I suspect that given the trio of “plaintiffs” this is an example of the strongest lions getting first dibs at the freshly killed wildebeest.
I agree that this sounds more like a ‘political’ backroom deal probably brokered mainly by the Fed which has the power at this point. (although the courts are starting to seriously infringe here) It seems to be trying to engineer the meltdown in a way to throw some meat to the lions.
Bingo: the Federal Reserve is both a regulator of, and a claimant against, B of A — talk about leverage!
What surprises me a bit, given the populist slant of this blog, is the absence of comment about the fact that institutional investors who made poor decisions are getting partial compensation for their gross screw-ups. Meanwhile, there is no principal relief for underwater borrowers, some of whom took on inappropriate loans, and others of whom merely suffered collateral damage as the E-Z financing carpet was yanked out from under the housing market.
In that respect, the B of A settlement resembles the rancid Greek bailout, in which the Greek state and people are mere conduits for public institutions bailing out private institutions.
Smash the banks! Abolish the Fed!
It was Jim Sinclair who said derivative failures would never see the inside of a court room, ever. This time around, not even subpoenas or depositions or even a court filing.
Probably never know the breakdown or the actual return on the dollar the investors receive when it is all said and done but better to take the money now while it is still worth something unless you want a bunch of worthless property notes instead.
No way are banks going to expose themselves or their dealings, they would rather go broke first than fess up and it’s looking like another bailout is needed when you listen to how desperate turbotax-timmy is sounding.
I think the banks might be getting some back room pressure from from senators who bailed them out as certain states are getting crushed in foreclosures and housing related issues. They may be realizing this bank mess could get them tossed in the next election.
You are probably right about the senatorial pressure, chris. But bailing out the white-shoe crowd of Pimco, Blackrock and the New York Fed does absolutely nothing to stop the surge tide of foreclosures down at ground level. This is plutocrats helping plutocrats.
Noblesse oblige — you’re quite welcome!
Yup! The Lawyer Behind the Bank of America Settlement http://dealbook.nytimes.com/2011/06/29/the-lawyer-behind-the-bank-of-america-settlement/
Last year Ms. Patrick settled another mortgage securities case for $550 million on behalf of Pimco against Goldman Sachs and UBS.
“She has a deep understanding of the banking process and the constraints, motivations and incentives of the banking industry,” Harry M. Reasoner, a partner at Vinson & Elkins in Houston, said in an interview with Bloomberg News last fall.
It is unclear, for the moment, how Ms. Patrick and her partners will profit from the lawsuit against Bank of America. But the firm often gets paid on a contingency basis, meaning it takes a percentage of the settlement as compensation.
If that is the case, this would be one Texas-size payday for Ms. Patrick and her Gibbs & Bruns partners.
Nobility is not free. Well, unless screw widows and orphans to keep the ship afloat. Hence, screwing widows and orphans is free. Aah, the Nobility of rape and pillage.
BofA has learned nothing, save for the fact that they can get away with massive criminal fruad without serious consequences. BofA will no doubt continue on with business as usual. The settlement, likely a small pittance for the damage caused, will lead to no jail time for anyone at the firm. Until the crooks are behind bars, the looting will continue.
“BofA has learned nothing..”
Boy oh boy, are you ever in the ozone layer.
Please read my first comment above and then consider that the major players: JPMorgan Chase, Goldman Sachs, Morgan Stanley, Citigroup and Bank of America, constitute the major holders, therefore controllers, of the credit derivatives, that global financial virus, which they wield to do their ultra-speculating and manipulation of both regional, sovereign and global markets.
They know exactly what they are doing, and will continue to do so.
Why? Because the Treasury Dept. controls the NY fed. The list of banks that have told the fed to “pound sand” starts with Bears and ends with Lehman.
Ocwen Loan Servicing Takes Home from Handicapped Because There’s Equity
She had made countless calls to Ocwen throughout the past year and was repeatedly told that everything was fine and that she was under consideration for a modification. Now, all of a sudden, with absolutely no explanation, her home was to be sold at a trustee sale. Again she explained why they had fallen behind in the first place, that things had stabilized since then, that Ocwen had not allowed them to try to make up the payments they had missed, but rather had advised them to apply for a loan modification.
http://mandelman.ml-implode.com/2011/06/ocwen-loan-servicing-takes-home-from-handicapped-because-there%E2%80%99s-equity/
Feds subpoena mortgage records from Ally Financial
The Associated Press
DETROIT – Ally Financial says it has received subpoenas from federal investigators looking into mortgage fraud.
The company also says it will take a $100 million charge in the second quarter for payments it made to trusts to cover their losses on mortgage securities that went bad.
The Detroit company disclosed the payments and the investigation in a filing Wednesday with federal regulators. The filing is part of Ally’s move to sell stock to the public.
The U.S. government owns 74 percent of Ally, which it got in exchange for a $17.2 billion bailout.
Ally is the former finance arm of General Motors and now is a separate auto and mortgage loan company. Ally has postponed its IPO because of a recent slump in the stock market.
Link, please.
“The CEO of what had been one of the largest privately held mortgage lenders was sentenced Tuesday to more than three years in prison for his role in a $3 billion scheme that officials called one of the biggest corporate frauds in U.S. history.”
—-
“A homeless man robbed a Louisiana bank and took a $100 bill. After feeling remorseful, he surrendered to police the next day. The judge sentenced him to 15 years in prison.
Roy Brown, 54, robbed the Capital One bank in Shreveport, Louisiana in December 2007. He approached the teller with one of his hands under his jacket and told her that it was a robbery.
The teller handed Brown three stacks of bill but he only took a single $100 bill and returned the remaining money back to her. He said that he was homeless and hungry and left the bank.”
Settlement covers $424B of original face value PLRMBS out (mostly Countrywide deals) for 2% of face. This compares to earlier settlements with the GSE’s and AGO for under 1% of face and 4.5% of face value, respectively.
Ergo, will be viewed as good news as many were using the AGO 4.5% as a floor and numbers went higher (sometimes much higher) from there. –W
The GSE deals were underwritten to much higher standards but the GSEs had much better putback rights. Losses on Freddie and Fannie insured deals IIRC are projected to run 3-4% of the pools v. 30% projected losses across all subprime.
If Bof A is folding before the case has cleared preliminary procedural hurdles says to me the bank knows it if plaintiffs got discovery it would be game over.
This is part of the on-going cover-up. Moynihan’s spin that this wasn’t a “forced surrender,” but was about putting “legacy issues” to rest is nonsense on stilts. BofA didn’t close the door on litigation risk, far from it.
NYT:
Bank of America to Set Aside $14 Billion in Mortgage Deal
http://www.nytimes.com/2011/06/30/business/30mortgage.html?_r=1&src=me&ref=business
“This is another important step we are taking in the interest of our shareholders to minimize the impact of future economic uncertainty and put legacy issues behind us,” Brian T. Moynihan, the bank’s chief executive said …
“Bruce Thompson, the company’s chief financial officer, said the agreement does not cover loans sold by Bank of America to other private trusts, nor does it cover mortgage securities assembled from the home loans of third parties.”
‘If Bof A is folding before the case has cleared preliminary procedural hurdles says to me the bank knows it if plaintiffs got discovery it would be game over.’
B of A is getting a bargain merely in terms of its economic outlay now as against the scope of future possible incumbencies.
But, yes, you are correct, madam.
Which means, given the role that the Fed has taken and the absolute symbiosis of Wall Street and Washington — with all that implies in terms of regulatory capture and unwillingness to do anything that would hurt the banks — that something really blatantly stinks in B of A’s records.
Keep in mind that Pimco and BlackRock BOTH are STILL PROFITING from their companies’ auction rate securities that were pushed off onto small individual investors under fraudulent marketing. These perpetual bonds were marketed as “safe as cash.”
Pimco & BlackRock both had the cash to make defrauded small investors whole LONG ago. For three long years, they have let individuals s twist slowly in the wind, without their “cash” Pimco & BlackRock investments — just because they could get away with it.
If there is any high moral ground from the 2008 collapse, Pimco and BlackRock belong nowhere near it.
Outstanding points, Ms. Kathy, and the most intelligent comments on this post.
I think everyone misses the point of the potential “settlement”.
Let’s assume BofA is going to settle claims on some 550 CHL MBS’s. Do you think that this is only for the claims made in this one suit? I don’t think so.
What I see is a calculated move to consolidate all claims against all CHL MBS’s (there are multiple investor lawsuits) and wipe away any future liability from that side of the equation.
Borrower Servicer MBS Investor
(there of course are parties in between, but you get the idea)
No suit has been able to get real traction because, IMHO and in the research I did into the MBS that holds my Note, the majority of the CUSIPS in any one MBS are owned by…..CHL now BofA. That is, they sold a bunch, but the lower trances (credit enhancement) are owned by the bank itself. That’s why Talcott Franklin’s efforts just disappeared from the radar. That’s why TIAA’s suit just went silent. No one has the level of investor involvement needed (as prescribed in the PSA) to bring suit.
SO…BofA says – let’s settle ALL the suits in some “class action” style, some % of the value, and call it good. If successful, they then eliminate any future suits from the Investor side.
Why does this matter? Because every time a homeowner gets to discovery and depositions, they risk another Linda DiMartini type of event. These don’t matter so much to individual foreclosures, but they do on the investor side (TIAA’s suit specifically claims chain of title issues based on Linda’s testimony).
Borrower Servicer MBS Investor
Take the MBS Investor out of the above? Now the homeowners are fighting a street fight every time.
The settlement has been published and the waiver addresses putbacks only. There is some language that BofA is required to disclose documentation issues.
But consider the SEC/Goldman Abacus settlement. It was limited to the one deal when Goldman hasd 25 Abacus trades. But the SEC showed no appetite to pursue other deals.
Note that the settlement is actually with the trustee, not the investors, So this is the trustee selling out the certificate holders (meaning the investors). Charming.
I cannot believe this will stick. The language of:
“BNY, as Trustee, will release the claims on behalf of the covered trusts and all associated investors”
I need to re-read the PSA for my particular MBS, but this would imply that – when you bought the bond – you gave away to the trustee (BONY) all decision making on “shareholder” suits?
I do not believe this is possible. I spoke to the VP who manages the CWALT 2007 trust I know well, he was very clear, he cannot act in a pro-active manner. (I was asking to buy my mortgage note from the MBS for a fair price). He was clear, he must stay passive. So how can he be passive and yet stand in for the interests of the investor? Makes no sense? Also, isn’t the goal of a trustee to get insolated from suit by having no fiduciary duty?
I wonder also if this covers 1:11-cv-01259-RMB Dexia Holdings, Inc. et al v. Countrywide Financial Corporation et al. Could they really have been part of this??
Finally – I think the real nugget is “BAC has agreed to implement certain servicing standards and address documentation deficiencies as part of the settlement, with
certain of the obligations starting now – The estimated cost to implement servicing and documentation obligations is approximately $400M and will contribute to a negative valuation charge on the MSR asset in 2Q11”
So, does this mean we can expect BAC to get all the indorsements caught up? That’s interesting.
Slide 3 of the attached from BoA’s website mentions that the settlement covers $424 Billion of original unpaid balance so “parlez vous good deal?”.
http://phx.corporate-ir.net/External.File?item=UGFyZW50SUQ9OTkwMDN8Q2hpbGRJRD0tMXxUeXBlPTM=&t=1
As others have said above, “The settlement is subject to court approval and covers 530 trusts with original principal balance of $424 billion.”
http://www.washingtonpost.com/business/bank-of-america-to-pay-85-billion-settlement-over-mortgages/2011/06/29/AGPPnTqH_print.html
Maybe there is a new form of deal-making that allows a savvy lawyer to use nothing more than press releases if she and/or her clients have a secret partner (the RMBS trustee) in their back pocket?
Even if this is only a “two-percent solution,” looks to me like the “press release lawyer” just cashed in $47 billion of RMBS for $940 MILLION for her small group of hugely powerful clients (NY Fed, PIMCO, et al.). She can retire on the deal if she earned even a contingency fee even as low as only one percent. Shit, I’d take a half percent.
The fees have been disclosed since BofA is covering them and they are $85 million.
It will be instructive to discover exactly which court will supervise this deal under exactly which law. Some of the coverage implied NY state courts are key, but I have not seen a pleading yet. If only NY courts & law are involved, it will be important to understand NY rules of civil procedure governing class actions. In particular, how may classes of RMBS trustees and RMBS investors be assembled that are adequate & typical representatives of all investors & trustees in all 530 RMBS trusts putatively governed by the deal? How many separate sets of attorneys were involved? Did any law firms represent both investors in a trust and the trustee of the same trust? If so, were all conflicts of interest waived? Stated another way, did all investors & trustees settle all potential claims & cross-claims among themselves at the same time as they settled claims against BAC?
I just saw on Squawk Box Europe the editor of Banker magazine trotting out his list of the top 1000 banks in the world. At number two JPMorgan, and the bestest bank in the whole darn world is the one that just took an 8.5 billion dollar 15 inch armor penetrating shell right through its A turret, the unsinkable Bank of America. This nonsense reminds me of how the German High Fleet crowed for days after the Battle of Jutland that they had routed the mighty British Grand Fleet. In private the top leaders told the Kaiser that they narrowly averted disaster and they had no chance to defeat the Brits. Undoubtedly the great grandfather of the Banker magazine cheerleader would rate the German Navy the number one navy in the world on June 2, 1916. I would just reiterate that BofA is now in a world where such blows will be repeated and its business model of 1996 to 2006 is completely and utterly broken. And with austerity mania just beginning here and the prospect of any QE3 to boost trading revenues fading fast and faster, I do not see how BofA is not what an FBR analyst was saying last week that it is worth much more chopped up and sold off than it is as a going concern.